Key question of who triggered IRS investigation of conservatives

WASHINGTON – The mystery about who triggered the IRS investigation into conservative groups deepened on Capitol Hill today, as testimony from the No. 2 man at the Justice Department appeared to contradict previously released information.

Deputy Attorney General James Cole testified before a subcommittee of the House Oversight Committee that a Justice Department attorney reached out to the IRS, apparently on his own initiative, but an email from that attorney indicated someone had asked him to look into conservative groups applying for tax-exempt status.

That attorney appears to have been Richard C. Pilger, director of the Election Crimes Branch in the Public Integrity Section of Criminal Division of the Department of Justice, or DOJ.

The person Pilger contacted at the IRS was former tax-exempt division chief Lois Lerner, the key person in the scandal, who has twice refused to testify before Congress, invoking her Fifth Amendment right against self-incrimination.

In his opening statement, Cole testified that a “Public Integrity Section attorney reached out to the IRS for a meeting” … “for the purpose of understanding what potential criminal violations, related to campaign finance activity, might evolve following the Supreme Court’s decision in Citizens United v. FEC.”

Cole testified Pilger “reached out” to Lerner, presumably on his own initiative, but in Pilger’s previously released email, he states, “I have been asked to run something by you.”

That would beg the question, who is that person who contacted Pilger and triggered the inquiry into tea-party groups? Investigators would be keen to know if that person was a higher-up at the Department of Justice, or perhaps even the White House.

Cole claimed that Pilger’s contact with Lerner showed that attorneys in the Public Integrity Section were “merely fulfilling their responsibilities as law enforcement officials: they were educating themselves on the ramifications of changes in the area of campaign finance laws and ensuring that the department remained vigilant in its enforcement of those laws.”

He said that was evidenced by the fact that no Justice Department inquiry was launched after the IRS was contacted.

But, that leaves unanswered the question as to why the IRS did, in fact, target conservative groups.

And that made the big picture in today’s hearing the effort by GOP committee members to build their case for the need for a special prosecutor to investigate the IRS scandal, including the role of the Justice Department.

Under intense questioning by subcommittee chairman Jim Jordan, R-Ohio, Cole admitted the DOJ had reached out to the IRS to inquire about whether conservative groups may have been in violation of their tax-exempt status.

Cole conceded that even after receiving 21 discs containing 1.1 million pages that included confidential taxpayer information, and having them in their possession for four years, the DOJ did nothing.

Jordan and Republicans may be using that admission to establish the case that the DOJ was a party to a cover-up.

Another brick in the case they are building was that neither IRS nor the DOJ took appropriate actions under the law when they discovered the IRS had lost two years of key emails, after the crash of hard drives belonging to the computers of Lerner and six other IRS employees.

Republicans contend the IRS and DOJ have stonewalled the investigation ever since Lerner announced the IRS had improperly targeted conservatives, just days after her last known email exchange with Pilger.

If committee Republicans can make a convincing case that the IRS and DOJ stonewalled and lied at the topmost levels, the only way to uncover the truth would be the appointment of a special prosecutor, who would have more extensive subpoena powers than even Congress.

That may be why ranking committee member Elijah Cummings, D-Md., has so vehemently insisted the investigation has shown there was no wrongdoing. If the GOP-controlled House were to vote to appoint a special prosecutor, the Democratic-controlled Senate would likely find it difficult politically to oppose that, especially with the midterm elections fast approaching.

Oversight Committee Chairman Darrell Issa, R-Calif., grilled Cole in an attempt to have him acknowledge that either the DOJ believes a crime has been committed or the investigation should be shut down.

That line of inquiry appeared to be intended to show that the DOJ may be keeping its investigation open, while really not investigating, merely in order to let the department continue to refuse to answer questions by claiming that it could not comment about an ongoing investigation.

An illustration of that tactic came minutes later, when Rep. Mark Meadows, R-N.C., asked Cole if anyone had at the DOJ had asked IRS Commissioner John Koskinen about why he did not report Lerner’s missing emails to Congress until two months after he had learned about it.

Cole replied he could not comment on an ongoing investigation.

Rep. Trey Gowdy, R-S.C., pressed the issue even further by asking a series of questions about the current state of the DOJ’s investigation into IRS abuse, beginning with, “How many witnesses have been interviewed?”

Cole replied that he could not say, and apologized, acknowledging it must be frustrating.

Gowdy made another case for the need for a special prosecutor by citing the words of President Obama, who said during an interview with Fox News on the day of the Super Bowl, that not only was there nothing to the IRS scandal, there was not even a “smidgeon” of corruption.

“You talk about jeopardizing an investigation. Talk about about tainting a jury pool,” noted the congressman.

He then called Obama’s comments a “tremendous disservice” to prosecutors because it had prejudiced an investigation to “score cheap political points during the Super Bowl.”

Gowdy concluded by observing that the DOJ is represented by woman a wearing a blindfold, indicating that justice is blind and should go wherever the evidence leads, and “when we start playing games with that, we are in trouble.”

Later, subcommittee chairman Jordan returned to the president’s comments and asked whether they would not affect the judgment of the person leading the DOJ’s investigation of the IRS, Barbara Bosserman.

When Cole insisted they would not, Jordan shook his head and said simply, “That’s amazing.”

Issa would later take another tack in emphasizing the need for a special prosecutor, beginning by pointing out that Cole and his boss, Attorney General Eric Holder, are both political appointees.

He continued, not only Lerner had been found in contempt of Congress, but so had Holder, for refusing to turn over documents in the Fast and Furious gun-running investigation.

Issa said that Congress does, indeed, “have contempt for your boss” because he is, in fact, in contempt of Congress.

That’s why we need an independent prosecutor in the IRS investigation, Issa pointedly told Cole, “to be independent of you.”

As WND reported , when Pilger’s email was released in April, Oversight Committee Chairman Darrell Issa, R-Calif., and 16 committee members sent a letter to Attorney General Eric Holder asking the Justice Department to produce documents to explain why his agency would consider prosecution of tax-exempt groups already improperly targeted by the IRS.

They also requested a transcribed interview with Pilger.

Judicial Watch had released IRS documents a week earlier showing Lerner was in contact with the DOJ about potential prosecution of tax-exempt groups.

That email, which was not released in the previous batch, was sent by Pilger to Lerner on May 8, 2013.

The committee said the DOJ considered prosecuting conservative groups for actions that are actually legal for 501(c)(4) nonprofits under federal tax law – that is, engaging in political speech.

The committee members wrote to Holder that Pilger’s communications with Lerner were also striking for their timing.

“They show that the IRS and the Justice Department were actively considering efforts to target tax-exempt organizations just two days before Ms. Lerner’s public apology for the targeting.

“This information certainly undermines the sincerity of Ms. Lerner’s apology, but it calls into question your reaction that targeting was ‘outrageous’ and ‘unacceptable.’

“These comments ring hollow in light of evidence that your subordinates apparently colluded with the IRS to target nonprofit groups less than a week before.”

An email from Lerner indicated someone at the DOJ wanted to target conservative groups for “lying” about their political activity.

According to the committee, after Pilger and Lerner spoke, she summarized the conversation in an email to Nikole Flax, then chief of staff to Acting Commissioner Steve Miller.

She wrote: “I got a call today from Richard Pilger Director Election Crimes Branch at DOJ. I know him from contacts from my days there. He wanted to know who at IRS the DOJ folks could talk to about Sen. Whitehouse idea at the hearing that DOJ could piece together false statement cases about applicants who ‘lied’ on their 1024s – saying they weren’t planning on doing political activity, and then turning around and making large visible political expenditures. DOJ is feeling like it needs to respond, but want to talk to the right folks at IRS to see whether there are impediments from our side and what, if any damage this might do to IRS programs.”

The committee said Lerner then asked veteran IRS official Nan Marks to arrange the meeting, but it is was not clear what additional steps the department took to coordinate with the IRS about the targeting of tax-exempt applicants.

The committee’s letter tells Holder: “This email is shocking on several levels. As an initial matter, this email is further evidence that the administration’s targeting and inappropriate treatment of conservative tax-exempt applicants was the result of political pressure from prominent Democrats to ‘fix the problem’ posed by the Supreme Court’s Citizens United decision.”

The letter goes on to indicate that the targeting of conservatives was the result of not-so-subtle prodding by the White House and Democratic lawmakers: “Information obtained by the committee shows that beginning in 2010, the president and congressional Democrats loudly and aggressively criticized the court’s decision and conservative nonprofit groups that they believed would benefit from it. This email makes clear that the Justice Department, like the IRS and the Securities and Exchange Commission, played a role in a government-wide effort to target political speech.”

The letter then indicates it is apparent the DOJ was taking its marching orders from the White House and other Democrats: “Certainly, as is apparent in this email, the department felt the need to do something in response to Democratic rhetoric against nonprofit political speech.”

The committee saw the DOJ as taking the matter to dubious extremes: “More unbelievably, this email also suggests that the department actually considered prosecuting nonprofit groups for their political activities. Even more astounding, the department considered prosecuting these groups for actions that are legal for 501(c)(4) nonprofits under federal tax law – that is, engaging in political speech.

“The Department’s use of alleged false statement on the tax-exempt application is an unfortunate instance of prosecutorial ‘gotcha,’ targeting these victims for supposed ‘lies’ about activities that they are legally allowed to do.

“In this way, the tactics suggested by Mr. Pilger appear to be nothing more than harassment by the Justice Department of groups engaged in otherwise lawful activity.”

The committee called the DOJ’s tactics “outrageous” and pointed out that even Lerner knew they were not on firm legal ground.

The letter to Holder cites an email Lerner wrote to her colleagues explaining that the law does not support the prosecution of a nonprofit for making false statements about political speech.

She wrote: “Whether there was a false statement or fraud regarding an [sic] description of an alleged political expenditure that doesn’t say vote for or vote against is not realistic under current law. Everyone is looking for a magic bullet or scapegoat – there isn’t one. The law in this area is just hard.”

Still, the committee noted, Lerner indicated in another email, that those individuals pushing for the prosecution of politically active nonprofits for “tax fraud” were seeking to “shut these down.”

She wrote: “One IRS prosecution would make an impact and they wouldn’t feel so comfortable doing stuff. So, don’t be fooled about how this is being articulated – it is ALL about 501(c)(4) orgs and political activity.”